Mexico Consumer Confidence September 2016

Mexico: Consumer confidence plunges in September

October 6, 2016

Consumer confidence worsened in September, reflecting households’ more pessimistic view of the future. The unadjusted index of consumer confidence produced by INEGI fell more than expected, from 86.5 in August to 84.2 in September. Adjusted for seasonality, the indicator decreased for a third consecutive month (September: -1.8% month-on-month; August: -1.5% mom), confirming consumers’ gloomy mood.

The headline figure marked the lowest level in more than six years and the details are discouraging. Consumers’ expectations of their own economic situation dipped to a multi-year low while their assessment regarding the country’s future economic conditions was the worst on record. Also, households’ assessment of both their present economic situation and the current national economic situation deteriorated markedly over the previous month.

Analysts attribute the downbeat mood to consumers’ growing discontent with the current government and the ongoing peso depreciation—which consumers tend to associate with a deteriorating growth outlook.

Panelists participating in the LatinFocus Consensus Forecast expect private consumption to grow 2.9% in 2016, which is unchanged from last month’s projection. For 2017, panelists see private consumption increasing 3.0%.

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